Discussions about dismantling the U.S. Department of Education (DoE) have led to widespread speculation about the future of student loans. While some believe the agency’s elimination could lead to sweeping policy changes, experts largely agree that student loan obligations will remain intact. Regardless of which federal entity oversees repayment, borrowers will still be required to fulfill their loan commitments.
Why It Matters
President Donald Trump has reiterated his stance on dismantling the DoE, viewing it as an unnecessary federal agency and advocating for a return of education oversight to the states. However, dissolving the DoE would require congressional approval, which remains uncertain. Even if the department is abolished, student loan programs—many of which predate the DoE—would likely be transferred to another federal agency rather than eliminated entirely.
The potential dismantling of the DoE would not just be an administrative shift—it could have significant consequences for millions of borrowers and the broader education system. The department currently oversees federal student loan programs, distributes financial aid and enforces policies meant to protect borrowers from predatory lending practices. Eliminating the DoE could introduce uncertainty into loan servicing, possibly delaying repayments, altering forgiveness programs or making it harder for students to access federal aid.
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What to Know
The fate of student loans remains a pressing concern for borrowers as discussions about the Department of Education’s potential elimination continue. While changes to the administration of loans may occur, the underlying obligations are expected to persist. Understanding how these shifts could impact loan management and repayment structures is essential for those with federal student debt.
The DoE currently administers over $1 trillion in student loans. If it were dissolved, the responsibility for managing the federal student loan portfolio would likely shift to another government entity.
Mark Kantrowitz, a higher education and student loan expert, explained to Newsweek what would be the most likely route for a reallocation of responsibility. “The current student loan servicers will likely continue to service the loans, and the loan portfolio will be administered by a different federal agency, probably the U.S. Treasury,” Kantrowitz said.
Congressional Approval is Required
Kantrowitz continued to detail the probability of the DoE going away, noting the premise overall is unlikely. The DoE was established by Congress, meaning it cannot be eliminated through an executive order. Any attempt to dismantle the department would require legislative approval, likely needing a 60-vote supermajority in the Senate, which is currently unlikely.
“The U.S. Department of Education was established by Congress, and only Congress can abolish it. Eliminating the U.S. Department of Education does not have bipartisan support. Republicans have only a 53 vote majority in the Senate, and would need a 60-vote supermajority to eliminate the U.S. Department of Education,” Kantrowitz told Newsweek.
Changes in Loan Forgiveness and Repayment Programs
Even if the DoE is abolished, existing federal student loans and repayment obligations would not simply disappear. However, the structure of loan forgiveness programs could change, and eligibility requirements may shift. Conservative policy plans suggest transferring student loan programs to different federal agencies or reducing loan forgiveness initiatives.
Kevin Thompson, CEO of 9i Capital Group, explained to Newsweek, “Student loan programs predate the DoE, and in all likelihood, the department would simply be merged into another federal agency rather than eliminated entirely.”
Thompson continued by explaining what a potential removal of the DoE could manifest into instead. “If education funding shifts to block grants, the amount of money available for student loans and grants could become more limited. With a fixed pool of money allocated to each state, funding could be restricted to a smaller number of applicants, reducing overall access to loans and grants,” Thompson said.
What People Are Saying
Alex Beene, financial literacy instructor at the University of Tennessee at Martin, told Newsweek: “If the Department of Education is abolished, you will still have to pay back your student loans. The thought process being presented by some is that technically the end of the department should also trigger the end of student loans, as there would no longer be an entity to oversee them. However, student loan repayments bring in hundreds of billions of dollars a year to the federal government. They’re not giving that revenue up.”
Mark Kantrowitz, a higher education and student loan expert, told Newsweek: “President Trump cannot claw back loan forgiveness that has already been provided. In the words of one judge, you ‘cannot unscramble this egg.'”
Patricia Roberts, chief operating officer at Gift of College, Inc., told Newsweek: “My tip is to be sure to know what you owe. Have up-to-date records of where loans are held, payments made and outstanding balances owed broken down by principal and interest.”
What’s Next
While eliminating the DoE remains a possibility under a Republican administration, its dissolution faces significant legislative hurdles. Even if it were to be abolished, borrowers should expect their student loan obligations to continue under a different federal agency.
Experts advise borrowers to stay informed, maintain accurate records of their loans and prepare for possible policy shifts that could impact repayment and forgiveness programs. As the debate over the future of federal education policy continues, borrowers should take proactive steps to manage their debt and explore repayment assistance options where available.
